The food price stop has arrived: from February 1, the prices of granulated sugar, wheat flour, sunflower cooking oil, pork thighs, chicken breast, chicken breast and 2.8 percent cow’s milk will also be restricted. The measure will last for 90 days and distributors will not be able to refrain from selling any of the products listed because the government has required them to keep the right amount on the shelf, he said. World economy in his podcast, Márton Nagy, Chief Economic Adviser to the Prime Minister.
According to the adviser, the reduction in overheads and the freezing of fuel prices have so far reduced inflation by 1-1.5 percentage points, to which a halt in food prices could add another half a percentage point in the future. The
Thus, the government was able to curb inflation by a total of 2-2.5 percentage points
He continued, which could bring inflation to 5 percent in 2022. According to him, the three percent central bank inflation target can be reached by the beginning of 2023.
According to Márton Nagy, last year’s economic growth was above 6 percent, which is one percent higher than the 2019 performance. The expansion in 2022 will be around 5 percent, which he says will also be a nice performance. He stressed that the domestic labor market has also gained new strength: 4.7 million people are in the domestic labor market and work and the unemployment rate is 3.6 percent. He added that while inflation in Hungary was 7.4 percent last November, the rate of general price increase was 8.9 percent in Poland last December.
The adviser estimates that the central government deficit could fall to 3.9 percent next year and 3 percent by 2024.
He also pointed out that special attention should be paid to the credit market, which may be pushed down by high interest rates due to high inflation. According to him, economic growth without credit is a bad process, and we can only avoid it by reducing inflation. The consultant highlighted:
if further external effects affect the Hungarian economy, further state interventions will be needed.
(Cover image: Salted pork legs in Riano di Langhirano on March 27, 2017. Photo by David Silverman / Getty Images)